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UK Prime Minister Andy Burnham unveils new cabinet and zero‑VAT electricity bill measure
Andy Burnham took office as the United Kingdom’s seventh prime minister on 20 July 2026 after King Charles III invited him to form a government following Sir Keir Starmer’s resignation. He promptly announced a reshuffled cabinet: John Healey was appointed chancellor, replacing Rachel Reeves; Ed Miliband became foreign secretary; Wes Streeting took over defence; Louise Haigh was named chancellor of the Duchy of Lancaster and first secretary of state; and other senior posts were filled with a mix of returning and new Labour figures.
Burnham’s first policy action was a cost‑of‑living relief: from 1 October the value‑added tax on household electricity will drop from 5 % to 0, saving an average household about £45 a year. The £850 million cost is to be covered by cancelling the previously planned digital‑ID programme. He also pledged a 10‑year national plan covering housing, regional devolution and re‑industrialisation, and promised measures to end homelessness.
In the week after his appointment, borrowing for June fell slightly below forecasts (£16 bn) but public finances remain described as fragile, and gilt yields rose to a two‑month high. Burnham stressed that any spending would respect existing fiscal rules while using “any flexibility” to deliver the announced reforms.